Sears Holdings closes deal on sale of Craftsman brand

HOFFMAN ESTATES, Ill. — Sears Holdings Corporation last week announced that it has closed the previously announced sale of its private label Craftsman brand to Stanley Black & Decker for a net present value of more than $900 million.

"The successful closing of the Craftsman transaction provides immediate liquidity to Sears Holdings, while enabling us to participate in the future growth of the Craftsman brand," stated Edward Lampert, chairman and CEO Sears Holdings.

The transaction provides Stanley Black & Decker with the right to develop, manufacture and sell Craftsman-branded products outside the Sears Holdings and Sears Hometown & Outlet Stores distribution channels. As part of the agreement, Holdings will continue to offer Craftsman-branded products, sourced from existing suppliers, through its current retail channels via a perpetual license from Stanley Black & Decker, which will be royalty-free for the first 15 years after closing and royalty-bearing thereafter.

As part of the closing, Sears Holding received an initial upfront cash payment of $525 million subject to closing costs and an adjustment for working capital changes. In addition, Stanley Black & Decker will pay a further $250 million in cash in three years and Sears Holdings will receive payments of between 2.5% and 3.5% on new Stanley Black & Decker sales of Craftsman products for the next 15 years.

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